China, Fed News Pulls Copper To 2013 Low
Copper slipped to a 2013 low on Thursday after China said it is considering a property tax to rein in sharp rises in home prices. Meanwhile, the US Federal Reserve signaled that quantitative easing may come to an end, with some board members voicing concerns that additional “asset purchases could foster market behavior that could undermine financial stability” and pose a risk to inflation.
“The Fed minutes and concerns over China's property sector hurt market sentiment, weighing down China's stocks market and commodities,” Peng Guoliang, an analyst at Dadi Futures, told Bloomberg.
Still, Wiktor Bielski, head of commodity research at VTB Capital, said he expects brighter economic data out of China as well as evidence of the restocking of copper. “We remain confident that these trends will steadily become more evident through 2013, driving prices higher, although in the short-term, markets are likely to remain pressured by renewed uncertainty,” The Wall Street Journal reported Bielski as saying.On the London Metal Exchange, copper for three-month delivery closed down 1 percent, to $7,880 per ton, from the $7,960 closing price on Wednesday. COMEX copper for March delivery was down 1.5 percent, at $3.5555 per pound, in mid-afternoon trade in New York. Company news BHP Billiton (ASX:BHP,NYSE:BHP,LSE:BLT) said Andrew Mackenzie, the current head of its nonferrous division, will replace CEO Marius Kloppers, who is retiring in May. BHP also said its revenue fell 14.1 percent in the six months to December 31, to $32.2 billion, while net impairments and exceptional costs of $1.4 billion caused its earnings per share to drop 58 percent, to 79.6 cents. Freeport-McMoRan Copper & Gold (NYSE:FCX) reached agreements with two bank syndicates that will provide it with a $4-billion term loan and a new $3-billion revolving credit facility in connection with its proposed acquisition of Plains Exploration & Production (NYSE:PXP) and McMoRan Exploration (NYSE:MMR).
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